Bribery Act Guidance Gives Clarity to SMEs

Small businesses can access practical advice on how to comply with the Bribery Act ahead of its introduction on 1 July, following the publication of guidance by the Ministry of Justice.

Under the Bribery Act, all businesses are required to have “adequate procedures” in place to prevent staff and anyone else who works on their behalf — such as agents — from giving or receiving bribes. Importantly, this includes anyone representing the business overseas. If convicted under the Act, directors risk an unlimited fine or even a prison sentence.

The Bribery Act 2010 Quick Start Guide explains that small businesses should assess the risk of their staff committing bribery, and says that they should put procedures in place that are proportional to that risk. A longer guide has also been published that includes case studies of specific businesses and the steps they have taken to avoid falling foul of the new legislation.

Key risk areas include trading internationally in places where facilitation payments are commonplace, trading with public officials and ensuring staff have clear guidelines on which corporate gifts are acceptable.

The guidance states that small firms need not worry about corporate hospitality if it is proportional to the revenue the client brings in — for example, if they take a client out for a meal to thank them. However, lavish gifts — for example, flying a potential client over to persuade them to buy from you — and facilitation payments to speed up business, are illegal under the Act.

British Chambers of Commerce director of policy and external affairs, Adam Marshall, said that the guidance has made the Act clearer for small firms:

“It highlights that common sense, rather than bureaucratic procedures, should lie at the heart of smaller businesses’ approach. We must avoid creating a situation where companies choose not to trade in fast-growing overseas markets, because they are afraid of getting it wrong.”

Marsden Rawsthorn employment solicitor, James Bellamy, said that the guidance would help small firms to put proportionate procedures in place.

“All businesses should look at where they get their business from, and whether there are opportunities for their staff or people who represent their business to give bribes. If there is no risk, they don’t need to put a policy in place.”

“For example, if they are a service business facing the general public, or if the owner of a retail business buys all the stock himself and the staff aren’t involved, they might decide they don’t need to put a policy in place. However, if they have sales executives out on the road, or if they operate in certain countries, they should consider including information about their policy on bribery in the staff handbook, and circulate it so employees are aware.”

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